After a lapse of 22 months, the Shanghai Composite Index fell below 3,000 A-shares into the “Bottom” stage.

It closed at 2907.82 points, after a lapse of 22 months, the Shanghai stock index fell below the 3000 mark for the first time.

Before the Dragon Boat Festival, the United States will arbitrarily impose a 25% tariff on about 50 billion US dollars of goods imported from China, adding to the Sino-US trade friction. Although Xiaomi delayed the review of the CDR issue, it still caused risk aversion in the market funds, and the external stock market fell. In the end, the Shanghai Composite Index opened lower on June 19, hitting a new low of 2871.35 points, eventually reaching 2907.82 points. Report. In the face of the stock market decline, the "Daily Economic News" reporter noted that many market participants have issued an optimistic voice, saying that A shares are not far from the bottom.

Two factors caused the Shanghai index to break 3000 points

Just announced that it will impose a 25% tariff on about 50 billion US dollars of goods imported from China. On the 19th of June, US President Trump announced plans to impose a 10% tariff on an additional 200 billion US dollars of Chinese goods.

The reporter noted that the Chinese Ministry of Commerce immediately responded to the volatility of the United States, saying that the US side has intensified its efforts after pushing the $50 billion tax collection list, threatening to set a tax bill of 200 billion US dollars. This kind of extreme pressure and blackmail has deviated from the consensus of the two sides and has also greatly disappointed the international community. If the US loses its rationality and introduces a list, China will have to adopt a combination of quantitative and qualitative measures to make a strong counter-measure.

The repeated trade frictions between China and the United States have filled the capital market with uncertainty and financial anxiety. Ren Zeping, the president of Evergrande Institute, published the latest article that Sino-US trade friction is long-term and increasingly severe. China's manufacturing industry has risen rapidly, and the added value has increased continuously in the global manufacturing value added ratio. China's development of high-end manufacturing is the only way to upgrade the industry. It is impossible to exchange core interests. The US is under the banner of trade protectionism.

From the dynamics of the stock market, the reporter of the Daily Economic News noticed that the external factors were affected by the trade friction between China and the United States, and the internal factors were still suffering from deleveraging. Since last week, the stock prices of some listed companies in A-shares have once again “flash collapse”, and the high proportion of equity pledges is still the cause of “flash collapse”.

In the background of the fund game, there is no incremental funds. Although Xiaomi urgently postponed the review of the CDR issue on June 19, it still failed to bring confidence to the A-shares. The Shanghai Composite Index opened lower and fell lower. It once fell to a new low of 2871.35. It eventually fell 3.78% throughout the day and closed at 2907.82. This is also the first time since the Shanghai Stock Index returned to 3000 points in July 2016, the first time after 22 months, it fell below the 3000 mark.

On the other hand, the GEM index was weaker, falling 5.76% throughout the day, closing at 1547.15 points, setting a new low in three years. "Daily Economic News" reporters found that the number of stocks in the two cities fell to 983 throughout the day, almost "thousands of stocks down."

At the bottom of the market, it is not far away. "I think the A-shares are falling again. The main reason is that the trade friction between China and the United States is uncertain. Because the trade friction between China and the United States is erratic, this effect is difficult to predict. The reason for the strong reaction of individual stocks is actually carefully analyzed. The biggest declines are stocks with very good textures, no core competitiveness, and good quality. The leading stocks of the industry are very strong. In this way, I am more optimistic about the future prospects of A shares, and good companies get stock funds. Even the focus of incremental funds is in line with the value investment orientation that started from last year. At present, after the Shanghai Composite Index falls below 3,000 points, the mood is vented. After repeated bottoming out at this position, the bottom of the A shares should not be far away.” The private equity manager who did not want to be named told the reporter of the Daily Economic News.

Indeed, Sino-US trade friction has brought many influences and uncertainties to the current capital market. Guojin Securities pointed out that the impact of Sino-US trade friction on the capital market has six aspects: First, risk appetite will fall marginally, but the degree may not be as late as the end of March. Secondly, the marginal easing direction of domestic monetary policy is more confirmed, and multiple RRR cuts are expected in the second half of the year. Third, the price of industrial products is facing downward pressure. Fourth, the US dollar index will continue to rise. Fifth, for the bond market, the interest rate bond of China Bond has formed a lot of profits, and the impact on the US debt is more reflected in the term spread. Sixth, corporate earnings expectations and risk appetite decline, but the risk-free rate is expected to decline.

The reporter noted that Sino-US trade disputes have also increased the risk of global stock markets. After the global stock market fell on Monday, on June 19th, the European stock market continued to fall, while the Asia-Pacific stock market also fell, not performing well.

Haitong Securities analyst Yan Yugen pointed out that the recent weakening of A-shares stems from event factors rather than fundamentals, and the market valuation level has returned to 2638 points of the Shanghai Composite Index. Sino-US trade friction is essentially a medium- and long-term economic game, and promoting domestic economic reforms can alleviate medium- and long-term concerns. At present, the A-share volatility pattern remains unchanged, and the low valuation against the interference event, the market enters the “bottom” stage, with stability first. Strategically optimistic about the technology industry, waiting for the performance of the interim report.

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